Rovio Announces Further Job Cuts And Business Refocus

The Angry Birds franchise has been through several iterations over the years, from the original Angry Birds, through Seasons, Rio, Star Wars and Transformers and more recently, Angry Birds 2 has been released. Over the years the game has become increasingly sophisticated as the developers, Rovio, have expanded the game to better utilize modern hardware, including larger screens and faster processors for both Android and iOS devices. However, whilst the franchise still has considerable market share amongst the public, the response to the games has been somewhat less over the years, but Angry Birds 2 has still managed fifty million downloads in a relatively short space of time. However, Rovio have undergone considerable transformation over the years and of course, Angry Birds is not their only project or game. Rovio have spoken up about some of their difficulties, explaining that they have taken on too many projects over the years and have needed to slim the business down.

To this end, today the sad news is coming in that Rovio has announced another series of layoffs with plans to make up to 260 redundancies. This announcement follows just over a hundred departures from the business last year, but at the time the business explained that they would likely be further job losses following a sharp decline in revenues that year. In addition to the news of the job losses, Rovio is set to consolidate its business focus back onto games, media and “consumer products,” but there is no mention of the education market: it seems that the writing is on the walls for this part of the company. Rovio Chief Executive Officer, Pekka Rantala, said this on the matter: “Rovio’s growth and eagerness to explore new business opportunities over the past few years have been exceptional. As a result, we did too many things… In our current financial condition we must now put focus on where we are at our best: in creating magnificent gaming experiences, in producing an amazing animation movie and in delighting our fans with great products.” We understand that the jobs under threat are at Espoo, at Rovio’s headquarters, and the Shanghai, Stockholm, London and Tokyo offices but those staff working on the Angry Birds movie in the United States of America and Canada are safe.

Rovio’s revenues fell by almost 10% in 2014 as sales of Angry Birds toys and merchandise, by 43%, was unable to replace an improvement in mobile sales by over 16%. At the time, the Chief Executive Mikael Hed spoke of focussing the business onto a more compact portfolio of products and it appears that this work is ongoing. The reduction of 260 staff amounts to approximately 38% of Rovio’s current workforce, pulling the number down from around 685 to 425, down from around 800 at Rovio’s peak in 2013. It’s clear that Rovio has undergone a period of rapid growth and has perhaps bitten off a little too much; there is much resting on Angry Birds 2 and the Angry Birds movie (due out next year).